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Originally Posted by Leshook
Hi there, we are looking to purchase a home and then rent it part of the year. I’ve been researching, and I’m hoping some would share here or privately if they feel the market is over saturated with rentals? Is it a profitable thing or do you just break even? Is there a certain area that is better for rentals? Thanks so much for any insight!
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How do you define "the market"? Lots of new building and new rentals in the south. The north has a fixed inventory.
I have two homes in the north that I rent part time. Over the last three years, costs have averaged $18,000 per year, per home. That does not include mortgage interest. It also doesn't include major repairs like roofs and HVAC.
You can easily rent Jan-April for that amount. When you find a good renter, they will return every year. So no worries about dogs, damage, etc. In fact, the people in my homes do minor repairs, clean the windows, maintain the golf cart, etc. The leave the house in better shape than when they moved in. You can find really good people without much trouble.
My neighbors love my renters. I have one January renter, and one March-April renter in each home that return every year.
The downside is you can't use your home during high season.
If you need to make a few thousand dollars more, therein lies the problem. Summer renters are an unknown factor. You'll get families and transient workers in the mix of applicants. Short term renters are a nightmare to manage and a disruption to the neighborhood.
So my conclusion is that it's easy to defer a lot of the cost and come close to breaking even. But don't count on making money, keeping your home in good shape, and keeping the neighbors happy at the same time.